Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation:

The Marketing Department has estimated sales as follows for the remainder of the year (in units):

The selling price of the beach umbrellas is $12 per unit.

All sales are on account. Based on past experience, sales are collected in the following pattern:

Sales for June totaled $264,000.

The company maintains finished goods inventories equal to 15% of the following month’s sales. This requirement will be met at the end of June.

Each beach umbrella requires 4 feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to 50% of the following month’s production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be:

Gilden costs $0.80 per foot. One-half of a month’s purchases of Gilden is paid for in the month of purchase; the remainder is paid for in the following month. The accounts payable on July 1 for purchases of Gilden during June will be $48,920.

Calculate the estimated sales, by month and in total, for the third quarter.

Calculate the expected cash collections, by month and in total, for the third quarter.

Calculate the estimated quantity of beach umbrellas that need to be produced in July, August, September, and October.

Calculate the quantity of Gilden (in feet) that needs to be purchased by month and in total, for the third quarter.

Calculate the cost of the raw material (Gilden) purchases by month and in total, for the third quarter.

Calculate the expected cash disbursements for raw material (Gilden) purchases, by month and in total, for the third quarter.

Seven metrics

The following data were taken from the financial statements of Woodwork Enterprises Inc. for the current fiscal year. Assuming that there are no intangible assets.

Determine the following: (a) debt ratio, (b) ratio of fixed assets to long-term liabilities, (c) ratio of liabilities to stockholders’ equity, (d) asset turnover, (e) return on total assets, (f) return on stockholders’ equity, and (g) return on common stockholders' equity. Round to two decimal places.

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(a) Divide total liabilities by total assets. Use the accounting equation to find total assets i.e., Total Assets = Total liabilities + Total Stockholders’ Equity

(b) Divide property, plant and equipment (net) by long-term liabilities.

(c) Divide total liabilities by total stockholders’ equity.

(d) Divide net sales by average total assets, excluding long-term investments. Average Total Assets = (Beginning Total Assets + Ending Total Assets) ÷ 2
To find ending total assets, use the accounting equation and substitute ending liabilities + stockholders’ equity for the amount.

(e) Divide the sum of net income plus interest expense by average total assets. Average Total Assets = (Beginning Total Assets + Ending Total Assets) ÷ 2
To find ending total assets, use the accounting equation and substitute ending liabilities + stockholders’ equity for the amount.

(f) Divide net income by average stockholders’ equity. Average Total Stockholders’Equity = (Beginning Stockholders’Equity + Ending Stockholders’Equity) ÷ 2

(g) Divide net income minus preferred dividends by average common stockholders’ equity. Common stockholders’ equity = Common stock + Retained earnings
Average common stockholders’ equity = (Beginning common stockholders’ equity + Ending common stockholders’ equity) ÷ 2

Manny, a calendar-year taxpayer, uses the cash method of accounting for his sole proprietorship. In late December he performed $24,000 of legal services for a client. Manny typically requires his clients to pay his bills immediately upon receipt. Assume Manny’s marginal tax rate is 37 percent this year and next year, and that he can earn an after-tax rate of return of 7 percent on his investments.

a. What is the after-tax income if Manny sends his client the bill in December?

b. What is the after-tax income if Manny sends his client the bill in January?

3. Hank, a calendar-year taxpayer, uses the cash method of accounting for his sole proprietorship. In late December, he performed $20,000 of legal services for a client. Hank typically requires his clients to pay his bills immediately upon receipt. Assume his marginal tax rate is 32 percent this year and will be 37 percent next year, and that he can earn an after-tax rate of return of 12 percent on his investments.

a. What is the after-tax income if Hank sends his client the bill in December?

b. What is the after-tax income if Hank sends his client the bill in January?

Someone else - what kind of account is "allowance for doubtful accounts".

1. Tell us about aging of receivables. Why would we age them?

2. What method are we using when we estimate bad debts?

3. what are the two methods of estimating bad debts? Which is easier for you to remember and why?

4. If you were focusing on your income statement (matching expenses to revenues), which method of estimating would you use?

Can you please solve this problem. The correct answer that should be found is below. Thank You

Early in 2015, Logan Corporation engaged Reese, Inc. to design and construct a complete modernization of Logan's manufacturing facility. Construction was begun on January 1, 2015 and was completed on December 31, 2015. Logan made the following payments to Reese, Inc. during 2015:

In order to help finance the construction, Logan issued $2,000,000 of 10-year, 9% bonds payable, issued at par on January 2, 2015, with interest payable annually on December 31.

In addition to the 9% bonds payable, the only debt outstanding during 2015 was a $500,000, 12% note payable dated January 1, 2010 and due January 1, 2020, with interest payable annually on January 1 and a $1,000,000, 10% bond payable dated July 1, 2011 due June 30, 2021 with interest paid annually.

Compute the interest to be capitalized in 2015. Logan uses the specific interest method. Show computations. The correct answer should be $244,200

why do we as professional accountants have to possess the excellent knowledge and skills in how to present and analyze stockholders' equity? explain in detail

1. Pick a company of your choice
2. Identify the industry in which this company operates
3. Identify a cost object for this company
4. Provide examples of the following types of costs for this company and the chosen cost obejct:
   • Fixed costs
   • Variable costs
   • Direct costs
   • Indirect costs
   • Inventoriable costs
   • Period costs
5. Respond to the thread posted by one of your classmates and provide examples for these cost categories for the company chosen by your classmate.

Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.
  

4. Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 80 units from beginning inventory and 340 units from the March 5 purchase; the March 29 sale consisted of 40 units from the March 18 purchase and 120 units from the March 25 purchase. (Round weighted average cost per unit to two decimals.)
  

Mercury Bag Company produces cases of grocery bags. The managers at Mercury are trying to develop budgets for the upcoming quarter. The following data have been gathered.

a. Using the above information, develop Mercury's sales forecast in dollars and production schedule in units.

b. What is Mercury's budgeted variable manufacturing cost per case?

c. Prepare Mercury's manufacturing cost budget.

d. What is the projected ending value of the Inventory account?

(TCO H) Audit risk consists of inherent risk, control risk, and detection risk. (a) Please completely define each of the above. (b) Indicate whether each of the statements below is true or false and explain your position. (1) The risk that material misstatement will not be prevented or detected on a timely basis by internal controls can be reduced to 0 by having effective controls in place. (2) Detection risk is a function of the efficiency of an auditing procedure. (3) Cash is more susceptible to theft than an inventory of coal because it has greater inherent risk. (4) The inherent risk of the theft of an inventory of cell phones at a mall store is greater than the misappropriation of cash at a COSTCO store.

(TCOs E and F) A Remington School District employee has been charged with theft and forgery for allegedly stealing approximately $72,000 in district funds.

Mary Blaner, 51, was charged in District Court with one count of second-degree felony theft and five counts of third-degree felony forgery. She is the second school district employee to be formally charged with stealing from the district. Both individuals were charged in separate and apparently unrelated cases.
Blaner, who was the district's payroll clerk, allegedly arranged electronic direct deposits of funds for nonexistent employees that then went to her, according to the police. Blaner was a trusted employee who had worked at the district for over 10 years. (Note: She just went through a divorce and has four children to support. She needs money for her children and a new car and had plans to pay the money back later.)
"Over the course of the last 15 months, she was able to allegedly siphon funds out of their (the district's) account into her account, and she allegedly set up fictitious employees." School district officials became suspicious when they had trouble balancing the district's account. After an internal audit, school officials came across payroll listings for workers who did not have any matching Social Security numbers. Another school district employee, Cindy Heap, who formerly worked as an elementary school secretary, earlier was charged with theft and 11 counts of forgery in a different case, according to Gary Searle, deputy county attorney. Heap allegedly took just under $90,000 in district funds, Searle said. Heap, 32, resigned from her job.

(1) What factors allowed these frauds to occur?
(2) What do you think the school district should do in the future to prevent fraud from occurring in the future?
(3) What responsibility do you feel the current school external auditor has to detect this fraud?
(4) How have the three elements of the Fraud Triangle enabled Mary to commit this fraud?

The budget committee of SUppar Company collects the following data for its San Miguel store in preparing budgeted income statements for May and June 2017.

1. sales for may are expected to be 800,000. sales in June and July are expected to be 5% higher than the preceeding month.

2. Cost of good sold is expecte to be 70% of sales

3. Company policy is to maintain ending merchandise inventory at 10% of the following months cost of goods sold.

4. Operating expenses are estimated to be as follows:

interest expense is 2,000 per month. Income taxes are estimated to be 30% of income before income taxes.

a) prepare the merchandise purchases budget for each month in columnar form.

b) prepare budgeted multiple-step income statements for each month in columnar form. Show in the statements the details of cost of good sold.

Homework 5:

Assume you work for the “Life is Good” T Shirt Company. In an effort to keep up with demand, the company has expanded facilities and purchased state of the art equipment to print t-shirts. The new equipment cost $980,000. There were additional expenditures of $25,000 for transportation to the facility and transport insurance. Additionally, a service and warranty policy was signed for the equipment which will cost $1800 a year for the next 5 years. The salvage value for the equipment at the end of its 5 year useful life is $82,000. The company has traditionally used straight line depreciation but they are considering using Double Declining balance methods. For simplicity, assume the purchase was made on Jan 1, 2018.

1) What value should be used to capitalize the new equipment on the balance sheet? Comment in text format on what expenditures you chose to include or exclude in this value and why.

2) Prepare a depreciation schedule for the five years of service life using SL and prepare an alternative schedule using DDB. (Hint: Whatever number you chose to capitalize above in 1) you should be using here as your Historical Cost). You may use excel for this portion.

3) Using the information created in the schedule, prepare a brief summarization to management explaining the two alternatives and the impact the depreciation method choice will have on the Income Statement in year 1 and year 2.

Warnerwoods Company uses a periodic inventory system. It entered into the following purchases and sales transactions for March.

  
For specific identification, the March 9 sale consisted of 80 units from beginning inventory and 340 units from the March 5 purchase; the March 29 sale consisted of 40 units from the March 18 purchase and 120 units from the March 25 purchase.

3. Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. (Round your average cost per unit to 2 decimal places.)

Problem 18-12 Various shareholders' equity topics; comprehensive [LO18-1, 18-4, 18-5, 18-6, 18-7, 18-8]

Part A
In late 2017, the Nicklaus Corporation was formed. The corporate charter authorizes the issuance of 6,000,000 shares of common stock carrying a $1 par value, and 2,000,000 shares of $5 par value, noncumulative, nonparticipating preferred stock. On January 2, 2018, 4,000,000 shares of the common stock are issued in exchange for cash at an average price of $10 per share. Also on January 2, all 2,000,000 shares of preferred stock are issued at $25 per share.

Required:
1. Prepare journal entries to record these transactions.
2. Prepare the shareholders' equity section of the Nicklaus balance sheet as of March 31, 2018. (Assume net income for the first quarter 2018 was $1,900,000.)

Part B
During 2018, the Nicklaus Corporation participated in three treasury stock transactions:

1. On June 30, 2018, the corporation reacquires 280,000 shares for the treasury at a price of $12 per share.
2. On July 31, 2018, 40,000 treasury shares are reissued at $15 per share.
3. On September 30, 2018, 40,000 treasury shares are reissued at $10 per share.

Required:
1. Prepare journal entries to record these transactions.
2. Prepare the Nicklaus Corporation shareholders' equity section as it would appear in a balance sheet prepared at September 30, 2018. (Assume net income for the second and third quarter was $3,400,000.)

Part C
On October 1, 2018, Nicklaus Corporation receives permission to replace its $1 par value common stock (6,000,000 shares authorized, 4,000,000 shares issued, and 3,800,000 shares outstanding) with a new common stock issue having a $.50 par value. Since the new par value is one-half the amount of the old, this represents a 2-for-1 stock split. That is, the shareholders will receive two shares of the $.50 par stock in exchange for each share of the $1 par stock they own. The $1 par stock will be collected and destroyed by the issuing corporation.

On November 1, 2018, the Nicklaus Corporation declares a $0.21 per share cash dividend on common stock and a $0.38 per share cash dividend on preferred stock. Payment is scheduled for December 1, 2018, to shareholders of record on November 15, 2018.

On December 2, 2018, the Nicklaus Corporation declares a 1% stock dividend payable on December 28, 2018, to shareholders of record on December 14. At the date of declaration, the common stock was selling in the open market at $10 per share. The dividend will result in 76,000 (0.01 × 7,600,000) additional shares being issued to shareholders.

Required:
1. Prepare journal entries to record the declaration and payment of these stock and cash dividends.
2. Prepare the December 31, 2018, shareholders' equity section of the balance sheet for the Nicklaus Corporation. (Assume net income for the fourth quarter was $2,900,000.)
3. Prepare a statement of shareholders' equity for Nicklaus Corporation for 2018.